Editorial: Hockey Canada has fouled up – but self-insurance isn’t to blame

It has been hauled over coals, lost its sponsors (including broker BFL Insurance), and has seen federal funding cut. Now, its board and CEO has stepped down.

The organisation has taken a battering in the national press, in part for what has been labelled a secret ‘slush fund’ allegedly in place to silence assault and abuse complainants.

The thing is, it’s not the existence of a self-insurance fund – which Hockey Canada has lately insisted was kept topped up by members’ insurance payments, paid as part of their registration fees – that should be the problem. And it would be dire for victims of assaults – and other personal injury claimants – if politicians and the public were to draw the conclusion that such self-insurance should not exist.

Self-insurance is a prudent way to protect an organisation – but far more importantly the people who need to claim against it – if an insurer will not cover its liabilities, something that Barry Lorenzetti, BFL Insurance CEO, highlighted when appearing before the committee in July.

As an aside, and as MPs appeared to grasp part way through questioning, it seems to me unclear why Lorenzetti, the head of Hockey Canada’s broker, was asked to appear rather than a representative of insurer AIG Canada, said to underwrite its sexual assault coverage.

A major issue with Hockey Canada’s National Equity Fund is around transparency, and it’s been reported that the insurance element of the fund does not appear in its annual reports. Hockey Canada ex-CEO Scott Smith has testified that $7.6 million from the fund has gone towards settling at least some of its 21 sexual misconduct lawsuits, many relating to abuse by former coach Graham James.

Read more: Hockey Canada makes official declaration over fund controversy

It doesn’t instil confidence that, according to Anthony Housefather MP, Parliamentary Secretary to the Minister of Public Services and Procurement, Hockey Canada has taken the federal government to court in a bid to hide its financials.

Hockey Canada is taking the Government of Canada to court now to stop disclosure of its financial information. Perhaps Hockey Canada prefers our Heritage Committee to summon the documents and have us ask them questions at a public hearing. @HedyFry @JohnNaterMP @MPJulian

— Anthony Housefather (@AHousefather) October 7, 2022

If you’re paying for insurance premiums to cover participation in sport, or many other group activities, the chances are that a sexual assault and abuse coverage element is included.

Will it make parents happy to know that this risk exists? Of course not. Should organisations be working to stamp out abuse and put in place the best possible safeguarding measures? Absolutely.

Back in the UK, I covered the Independent Inquiry into Child Sexual Abuse, and it was heartbreaking to see non-recent abuse claimants struggling to get reparation – which could be put towards vital needs like counselling or a financial reset after years of struggling – after years of being doubted or ignored because organisations had folded and/or had no insurance in place.

Once an insurer gets involved in a claim, this can lead to a long-winded (and more than likely not victim- or survivor-friendly) process that can last for years.

In settling the complainant’s case from its own fund, the organization will hopefully have spared them a potentially devastating merry go round of court scrutiny and litigation that has frequently been described as “re-abusive” by people who have gone through it.

Hockey Canada’s leadership has, meanwhile, confirmed it is chasing its insurer for the sum paid in settlement to the victim of the 2018 incident; it may well struggle with this.

Read more: Hockey Canada scandal – self-insurance and transparency

For the avoidance of doubt, I am not saying that Hockey Canada has done a good job here.

The continued insistence – including by interim chair Andrea Skinner last week, who has since resigned – that confidentiality agreements are in place solely to protect victims is baffling. And now ex-CEO Scott Smith’s apparent failure to act on a pledge, made in front of the Canadian heritage committee this summer, on rethinking existing NDAs is equally so.

Speaking to Insurance Business, Dr Julie Macfarlane, the co-creator of campaign Can’t Buy My Silence, which she spearheads alongside Harvey Weinstein whistleblower Zelda Perkins, labelled such confidentiality agreements an “exchange transaction”.

“What it [looks like is], I will give you, the victim, confidentiality and privacy, which 99.9% of the time they want, only if you will give me confidentiality and privacy,” Macfarlane commented.

Macfarlane, who has been involved in negotiating settlements for 25 years, pointed out that victims rarely do want any level of publicity – they “are almost always wanting to make sure that they can be private and disappear”, she said.

Her analogy – if I, as a big organisation facing allegations, give you a pizza and a bottle of wine, you shouldn’t have to give me the same thing back to make an agreement work.

Settlements should not be contingent on a complainant’s silence; they should be about redress.

Perhaps insurance has a role to play here in encouraging clients to look beyond these types of ‘under the carpet’ settlements.

Safeguarding and culture, too, are clearly issues. What happened to the 2018 victim is unthinkable and alleged assailants should not have been ‘protected’ or gone on to have careers in the sport.

The strange insistence from Skinner in front of last week’s committee that Smith deserves an ‘A’ grade for his handling of the debacle is – as Prime Minister Justin Trudeau has said – “inconceivable”.

At this stage, it seems like the only way for the sporting body to start to reinvigorate itself in the eyes of Canadians is for change at the top. The resignation of the board and CEO is a step in the right direction.

Incoming management at Hockey Canada needs to take a long, hard look at the situation and do the right thing; hopefully, with yesterday’s resignations, the organisation has started to set itself on the right path. But targeting self-insurance more broadly (including in cases where a sex assault or sexual abuse turns out to be uninsurable) will only do more damage than good to victims in a world – and sadly, from an outsider’s perspective, it is also a global problem; for a recent example, see US women’s soccer – still wrestling with endemic abuse challenges, a culture of silence, and safeguarding failures.